ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2015

Or

o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission file number 000-52390

ADVANCED VOICE RECOGNITION SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

NEVADA

98-0511932

State or other jurisdiction of incorporation or

organization

(I.R.S. Employer Identification No.)

7659 E. Wood Drive

Scottsdale, Arizona

85260

(Address of principal executive offices)

(Zip Code)

Registrant's telephone number, including area code is (480) 704-4183

Securities registered pursuant to Section 12(b) of the Act:

Title of each class: NONE Name of each exchange on which registered: NONE

Securities registered pursuant to section 12(g) of the Act

Common Stock $0.001 Par Value

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act: o Yes x No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. o Yes x No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes o No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). xYes o No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.

The aggregate market value of the outstanding common equity held by non-affiliates of the Registrant as of the last business day of the Registrants most recently completed second fiscal quarter was approximately $1,705,249 based upon the last reported sales price on the OTCBB for such date. For purposes of this disclosure, shares of common stock held by officers and directors of the Registrant have been excluded because such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily conclusive.

The number of shares of the Registrants common stock, as of March 23, 2016 was 227,345,268.

PART IV

The statements contained in this prospectus that are not historical are forward-looking statements, which can be identified by use of terms such as may, could, should, expect, plan, project, intend, anticipate, believe, estimate, predict, potential, pursue, target or continue, the negative of such terms or other comparable terminology, although some forward-looking statements may be expressed differently.

The forward-looking statements contained in this Annual Report are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, managements assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements contained in this Annual Report are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or the forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to various factors listed in this Annual Report. All forward-looking statements speak only as of the date of this Annual Report. We do not intend to publicly update or revise any forward-looking statements as a result of new information, future events or otherwise. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.

PART I

Item 1. Business.

General Overview.

Advanced Voice Recognition Systems, Inc. (the Company, we or us), is a software development company headquartered in Scottsdale, Arizona, with an office in Mitchell, South Dakota. We specialize in creating interface and application solutions for speech recognition technologies. Our speech recognition software and related firmware was first introduced in 1994 at an industry trade show. We currently have limited capital resources. We are not currently engaged in marketing any products. We have increased our efforts to monetize our assets. We are currently engaged in discussions with certain firms dedicated to assisting in the commercialization of intellectual assets.

We believe that speech recognition technology has a multitude of potential applications including but not limited to dictation and transcription, mobile messaging (voice to texting), server based web search, customer relations and translation.

Speech recognition technology, which provides for the conversion of speech into written text, is the threshold feature of our solutions. Our technology focuses on improving speech recognition technology by increasing speech conversion precision, with the goal of achieving near 100% accuracy and allowing the user to speak naturally. We also focus on improving user productivity and profitability by enabling the user to effectively utilize the written text produced by speech recognition technology (the End-Text) in multiple applications specific to the users business purposes and goals.

We believe our main competitors are Microsoft, Nuance, Google Voice and Apple. We also compete, and anticipate that we will compete, with several smaller niche suppliers.

Principal Proposed Products or Services

We have not achieved any revenues from product sales. In addition, we will need substantial additional capital to achieve our marketing objectives as described below.

Speech Recognition Software and Related Firmware

Our principal proposed product is speech recognition software and related firmware which allows for dictation into a broad range of applications, including DOS applications running in Windows, UNIX and mainframe applications accessed through terminal emulation programs, various custom applications , and all Windows 3.x, 95, 98, 2000, XP, Vista and Windows 7 programs. Through this product, we seek to provide full functionality including audio proofreading, deferred and delegated correction and additional capabilities that we believe are not available with other products. This product is designed to allow for deferred dictation, where the text is saved with the associated audio, and the users can resume when stopped and can play back dictated content. Similarly, the recognized text and associated audio can be saved to be used when text is corrected.

AVRS Enterprise Solutions

AVRS patented technology is applicable to many main stream speech enabled applications ranging from traditional desktop applications to mobile and web-based solutions. The technology reaches beyond simple speech recognition and transcription into many other applications thus enabling the exchange of spoken text transcription amongst numerous users on diverse system platforms, as well as enabling the transcribed text to be utilized by many interface applications. The key is the recognition of, and in many cases the transcription of, spoken text in a myriad of applications to allow a seamless interface among users and /or systems having disparate protocols. Recognition of dictated speech including spoken text and commands, over many platforms provides operations of systems having diverse requirements and capabilities.

AVRS patents cover both a method of implementation and a system whereby speech recognition and transcription can be operated upon and exchanged amongst users employing disparate legacy protocols through one or more transaction managers having a systems protocol. An underlying key factor in all AVRS patented technology lies in its enabling capability whereby any legacy application protocol can be made compatible with speech recognition and transcription engines with or without modification of the application or the protocol upon which the initiating or the receiving application relies.

Market

We believe that our patented technology has applications in vertical markets that require individuals and organizations to create reports, letters, e-mail, data entry, manuals, books, and virtually any other document or end product involving written data. These organizations include corporations, hospitals, medical product and service providers, governmental entities, legal professionals, sales and service organizations law enforcement agencies and mobile search and voicemail to text.

We believe that our patented technology has applications in OEM markets, targeting both software developers and hardware manufacturers. When we have sufficient available resources, we may approach the larger OEM companies with a joint marketing approach strategy while using a direct sale basis to approach small and medium-sized OEMs.

Hardware Manufacturers

We believe that our patented technology has applications in hardware manufacturing, and to that end, when we have sufficient available resources, we may approach hardware manufacturers both on a direct basis and through joint sales and marketing programs. We anticipate that we will offer technology and patent licenses to manufacturers of medical devices, digital dictation systems, recorders, workstation PCs, mobile phones, PDAs, WAPs, and intelligent electronics. Alternatively, we may offer these manufacturers limited versions of our speech recognition software and related firmware product line for embedding into hardware. When we have sufficient available resources, we expect to develop joint sales and marketing programs for mainframe, thin-client, telephony and other large hardware processing systems.

Distribution

Product development of the speech recognition software and related firmware was our primary focus for the first six years following the softwares introduction into the software market in 1994. Early forms of the speech recognition software and related firmware were marketed through a network of approximately 200 small dealers specializing in speech recognition technology. We no longer are focused on product development and instead are focusing on commercializing our existing intellectual property assets.

Our business model has been revised and we plan to collect royalty payments based on actual usage of the speech recognition software and related firmware in various applications.

Intellectual Property

Our primary assets are U.S. Patent #7,558,730, U.S. Patent #7,949,534, U.S. Patent #8,131,557, U.S. Patent #8,498,871, and U.S. Patent #9,142,217. U.S. Patent #5,960,447, our first patent, was for a word tagging and editing system for speech recognition, was filed on November 13, 1995 and issued on September 28, 1999. In accordance with 35 U.S.C. 154, the term for U.S. Patent #5,960,447 began on September 28, 1999 and ended 20 years from the date on which the application for the patent was filed in the United States, or November 13, 2015.

A word tagging and editing system for speech recognition receives recognized speech text from a speech recognition engine, and creates tagging information that follows the speech text as it is received by a word processing program or other program. The body of text to be edited in connection with the word processing program may be selected and cut and pasted and otherwise manipulated, and the tags follow within the audio data file created initially by the speech recognition engine. The sound bite may be replayed to the user through a speaker. The practical results include that the user may confirm the correctness of a particular recognized word, in real time whilst editing text in the word processor. If the recognition is manually corrected, the correction information may be supplied to the engine for use in updating a user profile for the user who dictated the audio that was recognized. Particular tagging approaches are employed depending on the particular word processor or other program being used.

On May 24, 2011, U.S. Patent # 7,949,534, entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning May 24, 2011 and ending 20 years from the application date of the parent application (US Patent #7,558,730) of November 27, 2001, or November 27, 2021. Costs totaling $3,365 were capitalized during the second quarter of 2011 and the Company began amortization

On March 6, 2012, U.S. Patent #8,131,557, entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning March 6, 2012 and ending 20 years from the application date of the parent application (US Patent #7,558,730) of November 27, 2021, or November 27, 2021. Costs totaling $5,092 were capitalized during the first quarter of 2012 and the Company began amortization.

On July 30, 2013, U.S. Patent #8,498,871, entitled Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning on July 30, 2013 and ending 20 years from the application date of November 27, 2001, or November 27, 2021. Costs totaling $21,114_ were capitalized during the third quarter of 2013 and the Company began amortization.

On June 27, 2013, the Company filed two additional continuation applications 13/928,381 and 13/928,383 with the U.S. Patent and Trademark Office entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols. On August 31, 2015 Application No 13/928,381 was abandon by the Company. Deferred costs were charged to operations the quarter ended September 30, 2015.

On August 10, 2015 the Company filed a continuation application 14/821,786 with the U.S. Patent and Trademark Office entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols.

On September 22, 2015, U.S. Patent #9,142,217, entitled Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning September 22, 2015 and ending 20 years from the application date of the parent application (U.S. Patent No 7,558,730) of November 27, 2001, or November 27, 2021. Costs totaling $35,068 were capitalized during the third quarter of 2015 and the Company began amortization

Research and Development

During fiscal years 2015 and 2014, we did not incur any expense for research and development activities.

Employees

We currently have two employees, Diana Jakowchuk our Secretary, Treasurer and Principal Accounting Officer and Walter Geldenhuys, our President, Chief Executive Officer and Chief Financial Officer. We may engage consultants and other service providers in the future to help us carry out our business plan.

Available Information

We file the following reports with the SEC under Section 13(a) of the Securities Exchange Act of 1934 as a smaller reporting company: Annual Reports on Form 10-K; Quarterly Reports on Form 10-Q; Current Reports on Form 8-K; and any amendments to these reports. You may request a copy of these filings at no cost. Please direct your requests to:

Diana Jakowchuk

Secretary, Treasurer, Principal Accounting Officer

AVRS, Inc.

7659 E. Wood Drive

Scottsdale, AZ 85260

Our website is located at www.avrsys.com. Information contained on our website is not a part of, and is not incorporated into this Annual Report on Form 10-K. The Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K, and all amendments to these reports and other information that we file with or furnish to the Securities and Exchange Commission, or the SEC, are accessible free of charge on our website. We make these documents available as soon as reasonably practicable after we file them with or furnish them to the SEC. You can also read and copy any materials that we file with the SEC at the SECs Public Reference Room at 100 F Street, NE, Washington DC 20549. You can obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site at www.sec.com that contains our reports, proxy and information statements and other information that we file electronically with the SEC.

Item 2. Properties.

Our principal executive offices are located at 7659 E. Wood Drive, Scottsdale, Arizona and are provided to us free of charge by Diana Jakowchuk, our Secretary, Treasurer and Principal Accounting Officer.

Commencing on June 19, 2008, our common stock has been quoted on the OTCBB under the symbol AVOI. The following table sets forth the high and low bid prices per share of our common stock for each full quarterly period in 2015 and 2014. These prices represent inter-dealer quotations without retail markup, markdown or commission and may not necessarily represent actual transactions.

High

Low

$

$

Three Months Ended December 31, 2015

0.01

0.01

Three Months Ended September 30, 2015

0.01

0.01

Three Months Ended June 30, 2015

0.01

0.01

Three Months Ended March 31, 2015

0.01

0.01

Three Months Ended December 31, 2014

0.01

0.01

Three Months Ended September 30, 2014

0.02

0.02

Three Months Ended June 30, 2014

0.01

0.01

Three Months Ended March 31, 2014

0.02

0.01

Holders

As of December 31, 2015, we have approximately 68 holders of record of our common stock and 224,595,268 shares issued and outstanding. The number of record holders was determined from the records of our transfer agent and does not include beneficial owners of common stock, whose shares is held in the names of various securities brokers, dealers and registered clearing agencies. The transfer agent of our common stock is Pacific Stock Transfer, 6725 Via Austi Pkwy, Suite 300, Las Vegas NV 89119.

Dividends

We have not declared any cash dividends, nor do we have any current plans to do so. We are not subject to any legal restrictions respecting the payment of dividends, except that they may not be paid to render us insolvent. We currently anticipate that we will retain all of our future earnings for use in the expansion and operation of our business and do not anticipate paying any cash dividends in the foreseeable future.

Unregistered Sales of Equity Securities

We have not sold any equity securities during the period covered by this Annual Report on Form 10-K that were not previously disclosed by us in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K.

Item 6. Selected Financial Data.

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operation.

The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This document contains certain forward-looking statements that involve risks and uncertainties, such as statements of the Companys plans, objectives, expectations and intentions. When used in this document, the words expects, anticipates, intends and plans and similar expressions are intended to identify certain of these forward-looking statements. The cautionary statements made in this document should be read as being applicable to all related forward-looking statements wherever they appear in this document. Our actual results could differ materially from those discussed in this document.

Results of Operation

We completed a stock exchange on May 19, 2008 and changed our business model. We have not generated any revenue since inception and do not have any cash generating product or licensing sales. We have incurred losses since Inception (March 15, 1994).

During the year ended December 31, 2015, we used $27,120 of cash in operating activities and $7,118 of cash in investing activities. We received $32,500 of cash from the sale of shares of our common stock. As a result, for the year ended December 31, 2015, we recognized a $1,738 net decrease in cash on hand. For the year ended December 31, 2014, we used $77,077 of cash in operating activities and $8,132 of cash in investing activities, and received net cash of $81,950 provided by financing activities, resulting in a $3,259 decrease in cash on hand for the year.

At December 31, 2015, we had current assets of $8,997 and current liabilities of $277,911 as compared to current assets of $10,736 and current liabilities of $228,957 at December 31, 2014. Our decrease in current assets resulted from a reduced amount of equity financing in 2015 as compared to 2014 and an increase in accounts payable from $66,574 at December 31, 2014 to $92,999 at December 31, 2015.

Because of our history of losses, net capital deficit and lack of assurance of additional financing, the audit report on our financial statements contains a going concern opinion regarding doubt about our ability to continue as a going concern.

In an attempt to address our financing needs, we have made sales of our common stock in private transactions.

During the twelve months ended December 31, 2015, we entered into Stock Purchase Agreements for the private sale to eleven persons or entities of an aggregate of 5,400,000 shares of the common stock for aggregate proceeds of $32,500. All of the proceeds were paid during the 12 months ended December 31, 2015.

During the twelve months ended December 31, 2014, we entered into Stock Purchase Agreements for the private sale to three persons or entities of an aggregate of 8,101,848 shares of the common stock for aggregate proceeds of $81,950. All of the proceeds were paid during the 12 months ended December 31, 2014.

On March 16, 2015 we entered into a letter agreement with Adapt IP Ventures, LLC (Adapt IP) confirming the retention of Adapt IP to assist us in identifying companies that might be interested in acquiring and / or licensing our patents, to attempt to negotiate financial terms and conditions for acquisition and / or licensing and to assist with collection of compensation from such entities. Adapt IP will receive a success fee of 15% of net compensation received from such entities based upon Adapt IPs efforts. We or Adapt IP may terminate the agreement upon 30 days notice to the other party.

On April 20, 2015 we made a Promissory Note to Adapt IP for $20,000, and Adapt IP agreed to pay to our patent counsel up to $20,000 for patent work on our behalf. The Note matures one year from the date of the Note. We are obligated to repay the funds advanced by Adapt IP plus a premium of 10% of the principal amount and a percentage of proceeds received by us from any monetization event involving the patents. If we repay the Note within the six months of the date of the Note, the percentage will be 1%, and it will be 2% after six months.

On August 20, 2015, AVRS entered into a letter agreement with Dominion Harbor Group, LLC pursuant to which Dominion will provide strategic advisory services to AVRS to support the common goal of the acquisition, sale, licensing, prosecution, enforcement, and settlement with respect to AVRSs intellectual property, including patents held by AVRS.

If we initiate or defend infringement actions, we would expect to incur substantial costs and legal fees that ultimately may not be recoverable.

We will require additional debt or equity financing or a combination of both in order to carry out our business plan. We incurred substantial legal fees and costs in connection with the interference proceeding with Allvoice, and we will likely continue to incur expenses in defending our patents and pursuing license agreements. We plan to raise additional funds through future sales of our securities, until such time as our revenues are sufficient to meet our cost structure, and ultimately achieve profitable operations. There is no assurance we will be successful in raising additional capital or achieving profitable operations. Our board of directors may attempt to use non-cash consideration to satisfy obligations that may consist of restricted shares of our common stock. These actions would result in dilution of the ownership interests of existing shareholders and may further dilute our common stock book value.

To obtain sufficient funds to meet our future needs for capital, we will from time to time, evaluate opportunities to raise financing through some combination of the private sale of equity, or issuance of convertible debt securities. However, future equity or debt financing may not be available to us at all, or if available, may not be on terms acceptable to us. We do not intend to pay dividends to shareholders in the foreseeable future.

We have increased our efforts to monetize our assets. We are currently engaged in discussion with certain firms dedicated to assisting in the commercialization of intellectual assets.

U.S. Patent #7,558,730 expands an extremely broad base of features in speech recognition and transcription across heterogeneous protocols. Costs totaling $58,277 have been capitalized and amortization began in the third quarter 2009.

U.S. Patent #7,949,534 is an expansion of the coverage of our second patent and incorporates speech recognition and transcription among transcription engines employing incompatible protocols. Costs totaling $3,365 have been capitalized and amortization began in the second quarter 2011.

U.S. Patent #8,131,557 is an expansion of our second and third patent. Costs totaling $5,092 have been capitalized and amortization began in the first quarter 2012.

US 8,498,871 titled Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols was issued July 30, 2013 by the U.S. Patent and Trademark Office. Costs totaling $21,114 have been capitalized and amortization began in the third quarter 2013.

On September 22, 2015, Patent #9,142,217 titled Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols (an expansion of our fourth patent) was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning September 22, 2015 and ending 20 years from the application date of the parent application (U.S. Patent No 7,558,730) of November 27, 2001, or November 27, 2021. Costs totaling $35,068 have been capitalized and amortization began in the third quarter 2015..

In order for our operations to continue, we will need to generate revenues from our intended operations sufficient to meet our anticipated cost structure. We may encounter difficulties in establishing these operations due to our inability to successfully prosecute any patent enforcement actions or our inability to effectively execute our business plan.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

To the Board of Directors and Stockholders of Advanced Voice Recognition Systems, Inc.:

We have audited the accompanying consolidated balance sheets of Advanced Voice Recognition Systems, Inc. (the Company) as of December 31, 2015 and 2014 and the related statement of operations, stockholders equity (deficit) and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statement referred to above present fairly, in all material respects, the financial position of Advanced Voice Recognition Systems, Inc., as of December 31, 2015 and 2014, and the results of its operations and its cash flows for the year then ended, in conformity with generally accepted accounting principles in the United States of America.

The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the Company's internal control over financial reporting. Accordingly, we express no such opinion.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flows from operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ B F Borgers CPA PC

B F Borgers CPA PCLakewood, CO March 25, 2016

ADVANCED VOICE RECOGNITION SYSTEMS, INC.

Consolidated Balance Sheets

DECEMBER 31,

DECEMBER 31,

2015

2014

ASSETS

Current Assets

Cash

$

8,997

$

10,736

Total Current Assets

8,997

10,736

Fixed Assets

Computer software and equipment, net

737

1,912

Total Fixed Assets

737

1,912

Intangible Assets

Patent, net

80,112

55,801

Deferred costs

1,485

29,435

Total Intangible Assets

81,597

85,236

Total Assets

$

91,331

$

97,884

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities

Accounts payable

$

92,999

$

66,574

Payroll

162,383

162,383

Note Payable AIP

19,935



Accrued Interest

1,994



Indebtedness to related parties)

600



Total Current Liabilities

277,911

228,957

Commitments and Contingencies

Stockholders' Deficit

Common stock, $.001 par value; 547,500,000 shares authorized

224,595,268 and 219,195,268, issued and outstanding respectively

$

224,595

$

219,195

Additional paid-in capital

7,702,248

7,675,148

Accumulated Deficit

(8,113,423)

(8,025,416)

Total Stockholders' Deficit

(186,580)

(131,073)

Total Liabilities and Stockholders' Deficit

$

91,331

$

97,884

The accompanying notes are an integral part of these financial statements.

The operations of Advanced Voice Recognition Systems, Inc. (AVRS or the Company), http://www.avrsys.com, commenced in 1994 with a predecessor entity called NCC, Inc. NCC, Inc. was incorporated on March 15, 1994 in the State of Ohio. NCC, Inc. operated as a software and hardware development company that marketed voice recognition and transcription products for commercial applications.

In May 2000, WG Investments, LLC acquired the assets of NCC, Inc. and subsequently changed its name to NCC, LLC. NCC, LLC (also a predecessor to AVRS) continued the operations of NCC, Inc. until approximately December 31, 2001, when shifts in the industrys markets caused NCC, LLC to suspend its operations.

AVRS was incorporated in the State of Colorado on July 7, 2005. In September 2005, the members of NCC, LLC transferred all of their membership interests in NCC, LLC to AVRS in exchange for 93,333,333 shares (post-recapitalization) of AVRS common stock. In December 2005, the Board of Directors approved a 1.5-to-1 stock split issuing 46,666,667 common shares (post-recapitalization), which increased the number of common shares outstanding to 140million shares (post-capitalization). Following the incorporation of AVRS, the Company initiated a new business plan and has continued its operations in the voice recognition and transcription industry.

AVRS is a software development company specializing in speech recognition technologies. AVRS has successfully obtained patent protection of its proprietary technology (refer to Note 3, Intangible Assets). The Company plans to focus its technologies for the medical profession because of the professions present extensive use of dictation and its need for multiple applications of speech recognition technology in the generation of reports, documents and medical bills. Additionally the Company plans to focus on server based dictation and transcription, visual voicemail and the voicemail to text market.

Stock Exchange Agreement

On April 28, 2008, the Company entered into a Stock Exchange Agreement (the Agreement) with Samoyed Energy Corp., a Nevada corporation (Samoyed), which resulted in a reverse acquisition. The Agreement provided for the reorganization of AVRS with Samoyed. In connection with the Agreement, Samoyed acquired all of the issued and outstanding common shares of AVRS in exchange for 140 million shares of Samoyeds common stock. On May 19, 2008, at the closing of the Agreement, the former shareholders of AVRS owned approximately 85% of the outstanding common stock of Samoyed, resulting in a change in control.

For accounting purposes, this acquisition has been treated as a reverse acquisition and recapitalization of AVRS, with Samoyed the legal surviving entity. Since Samoyed had, prior to the recapitalization, minimal assets and limited operations, the recapitalization has been accounted for as the sale of 24,700,008 shares of AVRS common stock for the net liabilities of Samoyed. Therefore, the historical financial information prior to the date of the recapitalization is the financial information of AVRS. Costs of the transaction have been charged to the period in which they are incurred.

In connection with the Agreement, a shareholder of Samoyed holding an aggregate of 3.5 million shares of Samoyeds common stock made payments totaling $565,651 since 2008 in lieu of tendering shares to the Company. The Company received the final payment of $6,000 on February 15, 2012.

Stock Purchase Agreements

During the year ended December 31, 2015 the Company entered into Stock Purchase Agreements for the private sale of an aggregate of 5,400,000 shares of the common stock for aggregate proceeds of $32,500, full payment of which was received in the period. During the year ended December 31, 2014, the Company entered into Stock Purchase Agreements for the private sale of an aggregate of 8,101,848 shares of the common stock for aggregate proceeds of $81,950, all of which was received in 2014.

Agreement and Plan of Merger

On March 25, 2009, the Company entered into an Agreement and Plan of Merger (Agreement and Plan of Merger) with its wholly-owned subsidiary, NCC, LLC, a Colorado limited liability company, whereby NCC, LLC merged with and into the Company pursuant to Section 92A.180 of the Nevada Business Corporations Act. Upon consummation of the Agreement and Plan of Merger: (i) NCC, LLC ceased to exist; (ii) the Companys membership interests in NCC, LLC automatically were canceled or retired and ceased to exist, without any consideration delivered in exchange thereof; (iii) the title to all estate, property rights privileges, powers and franchise assets and/or other rights owned by NCC, LLC became vested in the Company without reversion or impairment; and (iv) all liabilities of any kind of NCC, LLC became vested in the Company.

Note 2. Significant Accounting Policies

Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company may be unable to continue as a going concern for a reasonable period of time.

The financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Companys continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis and ultimately to attain profitability. During the years ended December 31, 2012 and 2011, the Companys President loaned or advanced the Company funds for working capital on an as needed basis. There is no assurance that these loans or advances will continue in the future. During the twelve months ended December 31, 2015 the Company received an aggregate of $32,500 from the sale of shares in private offerings of its common stock. During the twelve months ended December 31, 2014 the Company received an aggregate of $81,950 from the sale of shares in private offerings of its common stock.

The consolidated financial statements include our accounts and those of NCC, LLC which merged with and into AVRS, Inc. March 25, 2009. Intercompany transactions and balances have been eliminated. The accounts, results of operations and cash flows of acquired companies are included from their respective acquisition dates.

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments with original maturities of three months or less when acquired to be cash equivalents. The Company had cash at December 31, 2015 of $8,997, and $10,736 cash at December 31, 2014. No amounts resulted from cash equivalents.

Financial Instruments

The carrying amounts of cash, receivables and current liabilities approximate fair value due to the short-term maturity of the instruments.

Fixed Assets

Fixed assets are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets, ranging from three to five years. Expenditures for additions and improvements are capitalized, while repairs and maintenance costs are expensed as incurred. The cost and related accumulated depreciation of property and equipment sold or otherwise disposed of are removed from the accounts and any gain or loss is recorded in the year of disposal.

Revenue Recognition

Revenue from the sale of inventory is recognized on the date of sale, title and risk of loss have transferred to the purchaser, the fees are fixed or determinable and collection is reasonably assured. Revenue from the performance of services is recognized when services have been completed and collection is probable. There are no multiple element sales and no history of material returns. The revenue recognition policies relate to operations performed prior to the Companys reverse acquisition.

Income Taxes

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the recorded book basis and the tax basis of assets and liabilities for financial and income tax reporting. Deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income and tax credits that are available to offset future federal income taxes. The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on the Companys financial condition, results of operations, or cash flow. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. The Company did not record a cumulative effect adjustment related to the adoption of ASC 740.

Research and Development Costs

Research and development costs are expensed in the period incurred.

Patents, Deferred Costs and Amortization

Patents consist of costs incurred to acquire issued patents. Amortization commences once a patent is granted. Costs incurred to acquire patents that have not been issued are reported as deferred costs. If a patent application is denied or expires, the costs incurred are charged to operations in the year the application is denied or expires. The Company amortizes its patents over the lesser of their estimated useful life or twenty years from the patent application date.

The Company evaluates the carrying value of its long-lived assets under the provisions of Statement of Financial Accounting Standard (SFAS) No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets now referred to as ASC 360-10 Property, Plant, and Equipment  Impairment or Disposal of Long Lived Assets subsections. ASC 306-10 requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted future cash flows estimated to be generated by those assets are less than the assets carrying amount. If such assets are impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying value or fair value, less costs to sell. The Companys last impairment analysis was completed effective December 31, 2015. Impairment recorded for each of the years ending 2015 and 2014 was $0. See Note 3.

Loss per Common Share

The Company reports net loss per share using a dual presentation of basic and diluted loss per share. Basic net loss per share excludes the impact of common stock equivalents. Diluted net loss per share utilizes the average market price per share when applying the treasury stock method in determining common stock equivalents. At December 31, 2015 and 2014, there were no variances between the basic and diluted loss per share as there were no potentially dilutive securities outstanding.

Fair Value of Financial Instruments

The carrying amounts of cash and current liabilities approximate fair value because of the short-term maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. We do not hold or issue financial instruments for trading purposes, nor do we utilize derivative instruments.

The FASB Accounting Standards Codification (ASC) clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

Level 1:

Quoted prices in active markets for identical assets or liabilities.

Level 2:

Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability.

Level 3:

Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Subsequent Events

On February 26, 2016, Donald Getty, Chairman of the Board of Directors of Advanced Voice Recognition Systems, Inc. (the Company) passed away unexpectedly. Walter Geldenhuys, the remaining member of the Board of Directors, will serve as the sole director of the Company until a successor to Mr. Getty is duly qualified and appointed.

Recent Accounting Pronouncements

The Financial Accounting Standards Board (FASB) periodically issues new accounting standards in a continuing effort to improve standards of financial accounting and reporting. The Company has reviewed the recently issued pronouncements. During this review the Company decided to early adopt ASU 2014-10 which eliminates the definition of a development stage entity, eliminates the development stage presentation and disclosure requirements under ASC 915, and amends provisions of existing variable interest entity guidance under ASC 810.

Note 3. Intangible and Fixed Assets

Intangible Assets

The Company monitors the anticipated outcome of legal actions, and if it determines that the success of the defense of a patent is probable, and so long as the Company believes that the future economic benefit of the patent will be increased, the Company capitalizes external legal costs incurred in the defense of the patent. Upon successful defense of litigation, the amounts previously capitalized are amortized over the remaining life of the patent.

On November 13, 1995 the Company filed a patent application with the U.S. Patent and Trademark Office, which was granted on September 28, 1999 as U.S. Patent #5,960,447, Word Tagging and Editing System for Speech Recognition. In accordance with 35 U.S.C. 154, the term for the above referenced patent shall be for a period beginning on the date on which the patent issues and ending 20 years from the date on which the application for the patent was filed in the United States. The above referenced U.S. Patent expired on November 13, 2015.

On July 7, 2009, U.S. Patent # 7,558,730, entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning on July 7, 2009 and ending 20 years from the application date of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended September 30, 2009 and the Company began amortization.

On March 9, 2010, the U.S. Patent and Trademark Office declared interference between the Company as Senior Party and Allvoice Developments, US LLC as Junior Party. Due to the absence of a decision by the end of 2010, in the fourth quarter of 2010, AVRS impaired 100% of the deferred costs associated with the interference, resulting in a $1,068,860 impairment loss. On April 27, 2012, the BPAI entered a judgment denying the Companys motions. On May 29, 2012, AVRS filed a Request for Rehearing in the BPAI. On December 19, 2012, the BPAI entered a judgment denying the request for rehearing. The Company decided not to appeal as additional litigation would be costly and time-consuming and would divert the attention of management and key personnel from business operations.

On May 24, 2011, U.S. Patent #7,949,534, entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning May 24, 2011 and ending 20 years from the application date of the parent application (U.S. Patent #7,558,730) of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended June 30, 2011 and the Company began amortization.

On March 6, 2012, U.S. Patent #8,131,557, entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning March 6, 2012 and ending 20 years from the application date of the parent application (U.S. Patent #7,558,730) of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended March 31, 2012 and the Company began amortization.

On July 30, 2013, U.S. Patent #8,498,871, entitled Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning on July 30, 2013 and ending 20 years from the application date of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended September 30, 2013 and the Company began amortization.

On June 27, 2013, the Company filed two additional continuation applications 13/928/381 and 13/928,383 with the U.S. Patent and Trademark Office entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols. On August 31, 2015, Application 13/928,381 was abandon by the Company. Deferred costs were charged to operations the quarter ended September 30, 2015.

On August 10, 2015, the Company filed a continuation application with the U.S. Patent and Trademark Office entitled Speech Recognition and Transcription Among Users Having Heterogeneous Protocols.

On September 22, 2015, U.S. Patent #9,142,217, entitled Dynamic Speech Recognition and Transcription Among Users Having Heterogeneous Protocols, was issued by the U.S. Patent and Trademark Office. In accordance with 35 U.S.C. 154, the patent shall be for a term beginning September 22, 2015 and ending 20 years from the application date of the parent application (US Patent No. 7,558,730) of November 27, 2001, or November 27, 2021. The deferred fees were capitalized during the quarter ended September 30, 2015 and the Company began amortization.

Amortization at December 31, 2015 is as follows:

SCHEDULE OF INTANGIBLE ASSETS

Ended December 31, 2014

U.S. Patent #

Carrying Value

Amortization

Balance

5,960,447

$

63,247

$

63,247

$

--

7,558,730

58,277

25,806

32,471

7,949,534

3,365

1,174

2,191

8,131,557

5,092

1,480

3,612

8,498,871

21,114

3,587

17,527

$

151,095

$

95,294

$

55,801

Ended December 31, 2015

U.S. Patent #

Carrying Value

Amortization

Balance

5,960,447

$

63,247

$

63,247

$

--

7,558,730

58,277

30,498

27,779

7,949,534

3,365

1,487

1,878

8,131,557

5,092

2,002

3,090

8,498,871

21,114

6,119

14,995

9,142,217

35,068

2,698

32,370

$

186,163

$

106,051

$

80,112

Amortization expense totaled $10,757 and $11,224 for the years ending December 31, 2015 and 2014, respectively. Estimated aggregate amortization expense for each of the next five years is as follows:

SCHEDULE OF FUTURE AMORTIZATION

Year ending December 31,

2016

13,454

2017

13,454

2018

13,454

2019

13,454

2020

13,454

Thereafter

12,842

Total

$

80,112

Fixed Assets

Depreciation expense totaled $1,175 for the year ended December 31, 2015 and $1,175 for the year ended December 31, 2014.

PROPERTY PLANT AND EQUIPMENT

December 31, 2015

December 31, 2014

Computer equipment

$

6,627

$

6,627

Computer software

3,640

3,640

10,267

10,267

Less accumulated depreciation

(9,530)

(8,355)

Computer software and equipment, net

$

737

$

1,912

Note 4. Related Party Transactions

Indebtedness to Related Parties

During the years from 2000 through 2013, certain officers advanced the Company working capital to maintain the Companys operations. The Company owed the officers $600 and $-0- at December 31, 2015 and 2014 respectively. The Company also owed the officers aggregate of $162,383 at December 31, 2015 for accrued payroll.

Note 5. Income Taxes

A reconciliation of the U.S. statutory federal income tax rate to the effective rate is as follows:

December 31,

2015

2014

U.S. federal statutory graduated rate

34.00%

34.00%

State income tax rate, net of federal benefit

0.00%

0.00%

Rent & services

-3.40%

-.10.09%

Costs capitalized under Section 195

-30.60%

-23.91%

Effective rate

0.00%

0.00%

The Company is considered a start-up company for income tax purposes. As of December 31, 2015, the Company had not commenced its trade operations, so all costs were capitalized under Section 195. Accordingly, the Company had no net operating loss carry forwards at December 31, 2015.

Note 6. Concentration of Risk

Beginning December 31, 2010, through December 31, 2015, all noninterest-bearing transaction accounts are fully insured, regardless of the balance of the account, at all FDIC-insured institutions. On December 31, 2015, the Company had cash balances at one FDIC insured financial institution of $8,997 in non-interest bearing accounts, which amount does not exceed the related federal deposit insurance.

Note 7. Subsequent Events

On February 26, 2016, Donald Getty, Chairman of the Board of Directors of AVRS, passed away unexpectedly. Walter Geldenhuys, the remaining member of the Board of Directors, will serve as the sole director of the Company until a successor to Mr. Getty is duly qualified and appointed.

Note 8. Stockholder Equity / (Deficit)

The Company has issued shares of its common stock pursuant to certain agreements as described in Note 1.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A(T). Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer, who also is our chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) and pursuant to Rules 13a-15(b) and 15d-15(b) under the Securities Exchange Act of 1934, as amended (the Exchange Act) as of December 31, 2015. Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act, such as this Form 10-K, is recorded, processed, summarized and reported, within the time period specified in the SECs rules and forms, and that such information is accumulated and is communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on our review and evaluation, our chief executive officer, who also is our chief financial officer, concluded that our disclosure controls and procedures were adequate and effective, including consideration of the matters identified below to ensure that material information relating to us would be made known to them by others within the Company in a timely manner, particularly during the period in which this annual report on Form 10-K was being prepared, and that no changes are required at this time. The evaluation of our disclosure controls and procedures and the conclusion as to their adequacy and effectiveness, included consideration of the deficiency noted below and the fact that our chief executive officer and chief financial officer is extensively involved in day-to-day transactional activities combined with the fact that the volume of transactions and activities of the Company are limited.

We have identified, as of December 31, 2015, a lack of segregation of duties in accounting and financial reporting activities, which we believe is a material weakness. The size of our business necessarily imposes practical limitations on the effectiveness of those internal control practices and procedures that rely on the segregation of duties.

Management believes this deficiency in internal control did not result in material inaccuracies or omissions of material fact and, to the best of its knowledge, believes that the financial statements for the years ended December 31, 2015 and 2014 fairly present in all material respects the financial condition and results of operations for the Company in conformity with GAAP. There is, however, a reasonable possibility that a material misstatement of the annual or interim financial statements would not have been prevented or detected as a result of this weakness.

Managements Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of its management and directors; and

Our management assessed the effectiveness of its internal control over financial reporting as of December 31, 2014. We have identified, as of December 31, 2014, a lack of segregation of duties in accounting and financial reporting activities, which we believe is a material weakness. The size of our business necessarily imposes practical limitations on the effectiveness of those internal control practices and procedures that rely on the segregation of duties.

Management believes this deficiency in internal control did not result in material inaccuracies or omissions of material fact and, to the best of its knowledge, believes that the financial statements for the years ended December 31, 2015 and 2014 fairly present in all material respects the financial condition and results of operations for the Company in conformity with GAAP. There is, however, a reasonable possibility that a material misstatement of the annual or interim financial statements would not have been prevented or detected as a result of this weakness.

This Annual Report on Form 10-K does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only managements report in this Annual Report on Form 10-K.

Changes in internal control over financial reporting.

We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes.

There were no changes in our internal controls over financial reporting that occurred during the period covered by this Annual Report on Form 10-K that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

The following table and paragraphs provide the name and age of each of our current directors, executive officers and significant employees, the principal occupation of each during the past five years and, with respect to directors, the year in which the director was first elected as a member of our Board of Directors. Information as to the stock ownership of each of our directors and all of our current executive officers as a group is provided above under Security Ownership of Certain Beneficial Owners and Management. There are no family relationships between any director or executive officer. Our directors and officers serve until their respective successors are elected or appointed, as the case may be.

Mr. Geldenhuys, sole director of AVRS, has served as a member of our Board of Directors since May 2008. Mr. Geldenhuys served as the President of Advanced Voice Recognition Systems, Inc., a Colorado corporation, also known as AVRS, from 2005 until AVRS was merged with and into us in June 2008. From 2000 to 2005, Mr. Geldenhuys was a member of NCC, LLC, which became AVRSs wholly-owned subsidiary in 2005. In addition, Mr. Geldenhuys has owned Progressive Technologies LLC, a design and manufacturing concern, since 2002.

Ms. Jakowchuk has served as our Secretary, Treasurer and Principal Accounting Officer since May 2008. Ms. Jakowchuk served as Secretary to AVRS, Inc. (a Colorado company). Ms. Jakowchuk has worked in the accounting and sales departments of ADCO Paint & Supply, a retail coating company, since July 2006. Between December 2004 and July 2006, Ms. Jakowchuk served as office manager for a retail hardware company. From December 2001 to December 2004, Ms. Jakowchuk served as the State Victim Assistance Coordinator for MADD Victim Services. Prior to December 2001, Ms. Jakowchuk served as Records Manager for NCC, LLC a predecessor to AVRS. Ms. Jakowchuk received an Associates of Arts degree from Scottsdale Community College in 1979.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors and designated officers to file reports of ownership and changes in ownership of our equity securities with the Securities and Exchange Commission. Based solely on our review of the copies of such forms that we have received and on written representations from reporting persons, we believe that during the fiscal year ended December 31, 2015 all reporting persons complied with all applicable filing requirements.

We have adopted a Code of Ethics applicable to anyone who serves as our Chief Executive Officer, Chief Financial Officer, principal accounting officer or controller. A copy of the Companys Code of Ethics is incorporated by reference to this Form 10-K as Exhibit 14.1.

Audit Committee

The entire Board of Directors operates as the Audit Committee. We currently do not have a written audit committee charter or similar document. When the audit committee is formed, we intend to have a designated audit committee financial expert who will be responsible for reviewing the results and scope of the audit, and other services provided by the independent auditors, and review and evaluate the system of internal controls.

Item 11. Executive Compensation.

Summary Compensation Table

The following table sets forth all compensation paid to our principal executive officer and those individuals who received compensation in excess of $100,000 per year (collectively, the Named Executive Officers) for our last two completed fiscal years.

Summary Compensation Table

A

Name and Principal

Position with AVRS

B

Year

C

Salary

($)

D

Bonus

($)

E

Stock

Awards

F

Option

Awards

($)

G

Non-Equity

Incentive

Plan

Compensation

($)

H

Nonqualified

Deferred

Compensation

Earnings

($)

I

All Other

Compensation

($)

J

Total (1)

Walter Geldenhuys,

2015

1,500

0

0

0

0

0

0

1,500

President, CEO, CFO Director (1)

2014

6,500

0

0

0

0

0

0

6,500

Diane Jakowchuk,

2015

0

0

0

0

0

0

0

0

Principal Accounting Officer(2)

2014

35,392

0

0

0

0

0

0

35,392

1 Mr. Geldenhuys was appointed to our Board of Directors and as our President, Chief Executive Officer and Chief Financial Officer in May 2008. Mr. Geldenhuys also served as the President, Chief Executive Officer and Director of AVRS during the year ended December 31, 2007 and until AVRS merged with and into us in June 2008. The amounts reflected in this table include compensation Mr. Geldenhuys received as President, Chief Executive Officer of AVRS in 2014 and 2015.

2 Ms. Jakowchuk was appointed as our Secretary, Treasurer and Principal Accounting Officer in May 2008. The amounts reflected in this table include compensation Ms. Jakowchuk received as Secretary, Treasurer and Principal Accounting Officer in 2014 and 2015.

3 Due to reduced sales of shares in private offerings of common stock in 2013, $162,383 of officer compensation was accrued as payroll payable. Total Officer Compensation paid in 2014 was $41,892 and $1,500 in 2015. The Company continued to experience a reduction in income. The officers agreed that no payroll would accrue in 2014 or 2015.

Salary (Column C)

The amounts reported in column C represent base salaries paid to each of the Named Executive Officers for the relevant fiscal year.

Bonus (Column D)

The amounts reported in column D represent the cash bonuses paid each of the Named Executive Officers for the relevant fiscal year.

Option Awards (Column F)

The amounts reported in column F represent the dollar amount of stock option awards recognized for each of the Named Executive Officers as compensation costs for financial reporting purposes (excluding forfeiture assumptions) in accordance with FAS 123(R) for the relevant fiscal years.

Effective January 1, 2006, we adopted the provisions of SFAS No. 123(R), which requires the measurement and recognition of compensation expense for all share-based payment awards (including stock options) made to employees and directors based on estimated fair value. We previously accounted for the stock options under the fair value recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation, as amended by SFAS No. 148, Accounting for Stock-Based Compensation  Transition and Disclosure now known as ASC 718 Compensation  Stock Compensation.

The fair value of each option award is estimated on the date of grant using the Black-Scholes valuation model that uses the assumptions noted in the following table. Expected volatilities are based on implied volatilities from similar companies that operate within the same industry sector index. We calculated the historical volatility for each comparable company to come up with an expected average volatility and then adjusted the expected volatility based on factors such as historical stock transactions, major business transactions, and industry trends. The expected terms of the options are estimated based on factors such as vesting periods, contractual expiration dates and historical exercise behavior. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

Employment Contracts and Termination of Employment and Change-In-Control Arrangements

We do not have written employment agreements or other employment arrangements with any of our executive officers. Our Board of Directors periodically evaluates the appropriate terms and conditions for the employment of our executive officers.

Outstanding Equity Awards At Fiscal Year End

We do not have any unexercised stock options outstanding for any of our named executive officers.

Director Compensation

We have made no arrangements for the remuneration of our directors, except that they will be entitled to receive reimbursement for actual, demonstrable out of pocket expenses, including travel expenses, if any, made on our behalf. No remuneration has been paid to our directors for services to date.

The following table sets forth all compensation paid to our directors for the last completed fiscal year.

Name

Fees Earned

Or

Paid in Cash

($)

Stock Awards

($)

Option Awards

($)

Non-Equity Incentive

Plan

Compensation

($)

Change in Pension

Value and

Nonqualified

Deferred

Compensation

Earnings

($)

All Other

Compensation

($)

Total

($)

Walter Geldenhuys (1)

0

0

0

0

0

0

0

Donald Getty(2)

0

0

0

0

0

0

0

1.Mr. Geldenhuys did not receive any compensation during the years ended December 31, 2014 and 2015 for his service as one of our Directors.

Beneficial ownership is defined in the regulations promulgated by the SEC as (A) having or sharing, directly or indirectly (i) voting power, which includes the power to vote or to direct the voting, or (ii) investment power, which includes the power to dispose or to direct the disposition, of shares of the common stock of an issuer; or (B) directly or indirectly creating or using a trust, proxy, power of attorney, pooling arrangement or any other contract, arrangement or device with the purpose or effect of divesting such person of beneficial ownership of a security or preventing the vesting of such beneficial ownership. Unless otherwise indicated, the beneficial owner has sole voting and investment power.

(2)

This amount includes 136,000 shares of common stock held by Mr. Geldenhuys daughter, of which Mr. Geldenhuys may be deemed to have indirect ownership because he is his daughters custodian.

(3)

This amount represents 1,600,000 shares held by Sunnybank Investments Ltd., a consulting company of which Mr. Getty formerly was President. Prior to his death in February 2016, Mr. Getty held exclusive voting and investment power with respect to the securities held by Sunnybank Investments Ltd.

Aside from the relevant provisions of the Nevada Revised Statutes and other applicable laws, we currently do not have a formal policy or procedure for the review, approval or ratification of related party transactions.

Director Independence

Our Board of Directors affirmatively determines the independence of each director and nominee for election as a director, and has adopted the independence standards of the NASDAQ Capital Market, LLC. At this time, Walter Geldenhuys, the sole member of the Board of Directors, is not independent.

Item 14. Principal Accounting Fees and Services.

The following table sets forth the fees billed to us for professional services rendered by our principal accountant for years ended December 31, 2015 and December 31, 2014.

Services

2015

2014

Audit Fees

$

15,930

$

15,930

Audit Related Services

6,967

5,468

Tax Fees

1,350

1,715

Total Fees

$

24,247

$

23,113

Audit fees consist of fees for the audit of our financial statements. Audit related services include review of our financial statements and quarterly reports that are not reported as audit fees. Tax fees included tax planning and various taxation matters.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, this 25th of March, 2016.

ADVANCED VOICE RECOGNITION SYSTEMS, INC.

/s/ Walter Geldenhuys___________________________

Walter Geldenhuys, President, Chief Executive Officer,

Principal Executive Officer, Chief Financial Officer,

Principal Financial Officer, Sole Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

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